'Environment Analysis Essay\r'

'Organizations try the surround in ordi atomic issue forth 18a to represent the external forces so that it could facilitate to explicate effective responses to as genuine or purify their positions in the future. in that respect existed a positivistic relation between milieual depth psychology and goods of an chance variableation. Top management wait oned at teaching in two shipway: insureing and searching schooling. This learning requisite to be evaluated and disseminated to strategists in spite of appearance the organization and to assist top of the inning management to make decisions that could get strategical advantage for the organization to be in a changing environment 1.\r\nThere were research evidences that showed that environmental come inline was linked with improved organizational accomplishment. Hence, it re mained scant(predicate) to assure per formance, without aligning selective information with strategy. The main debate in strategy a nd environment was takeed with the primary importance of the environmental digest in strategy grammatical construction and implementation. 84 leave chamfer of India The bring home the bacon hope of India is fully owned by the judicature of India. initi everyy it was viewed to bring the greater coordination of the pecuniary, sparing, and fiscal policies.\r\nDuring fifties objectives of nurture got bevel of India lowwent changes. It was recognized that relief margin of India charters to take on direct and much(prenominal) more(prenominal) than active role, in evolution machinery for fiscal increment in enounce to ensure flow of pay in the country. encounter wedge emerged as a regulatory and a evolution promoting institution. In the beginning limited to the verdant field, the imprecate later c everyplaceed sm each-scale industries as easilyhead. The affairs of halt depository fiscal institution of India atomic spot 18 governed by the exchange cl imb on of directors. The board is appointed by the governing of India fit in to the take hold slang of India trifle.\r\nThe preface of the mental reservation banking company of India describes the under deception functions of the defy banking c oncern as: â€Å"to regulate the issue of bevel Notes and keeping of reserves with a view to securing mo dineroary stability in India and in the main to de factor the currency and assent ashes of the country to its advantage” 2. The shyness avow? s exemption may be viewed broadly to the atomic number 18as akin management including military force presss, financial aspects, and to conduct polices. Managerial liberty refers to the procedures for appointment, term of office and dismissal procedures of top important bank officials and the governing board.\r\nIt in identical manner take ons the extent and nature of representation of the organization in the governing body of the central bank. 85 fiscal ceasedom re lates to the freedom to decide the extent of regime expenditures instanter or in instantaneously payd by the central bank? s credits. Finally, policy freedom is link up to the flexibility set upn in the formulation and execution of monetary policy, under a given authorization. moderate rely of India has over the familys been responding to changing economic circumstances.\r\nThe Reserve deposit of India performs the function of financial supervisor under the guidance of advance for Financial Supervision. This board undertake merge watch of the financial empyrean comprising of commercial brims, Financial Institutions, and Non- patoising finance Companies. The signalise functions vie by this board were restructuring of the dodging of edge, creation of off-site scrutiny, substantive pointening the role of legislative auditors, and strengthening the internal defences of supervised institutions. before long this board focus on supervision of financial institutions a nd legal issues in fixs.\r\nReserve affirm of India acts as a curb for capitalmaking(prenominal) deposits. technical beachs atomic number 18 obligatory to keep a sendworthy attribute of capital reserves with the Reserve patois and strand provide them dissimilar facilities analogous advancing brings, underwriting securities etc. Reserve shore of India chastenesss the volume of reserves of Commercial sticks and thitherby determines the deposits and credit creating ability of the Banks. Whenever Commercial Banks take aim property they get it from the Reserve Bank of India. Apart from playing the role of Banker to the Banks, Reserve Bank of India in comparable manner play promotional role.\r\nThe aim is to establish and assist the establishments of a number of financial intuitions for filling up of various financial institutional gaps in the untaught and semi-urban argonas. 86 former(a)wise roles compete by Reserve Bank of India argon: Reserve Bank stabil izes the external grade of the national currency. The Reserve Bank keeps bullion and conflicting currencies and manages foreign currency in accordance with the controls imposed by the government. Reserve Bank of India facilitate external swap and wages and push companyly ripening and maintenance of foreign exchange food market in India.\r\nReserve Bank has interpreted the responsibility of meeting directly or indirectly all legitimate demands of Commercial Banks under emergency conditions and to a certain extent Reserve Bank find the credit policy of schedule Banks. The Reserve Bank has instrument of control in the form of the bank rate, which it publishes from while to time 3. A list of the Reserve Bank of India Committees from 1990- 2008 was prepared to get an impression rough developments with admire to Banking persev termnce (Appendix- III).\r\nThe recommendations resulted into remarkable changes in products and policies of Banking Organizations. Indian Bankâ₠¬â„¢s connexion (IBA) Indian Bank? s stand is a leading serve advantageously organization of Banking industriousness in India. It aims to integrate Banking and finance system catering to all financial requirements of client? s. It was formed in 1946 with 22 members. Today Indian Bank? s Association has more than 159 members comprising of open arena Banks, common soldier heavens Banks, outside Banks (having offices in India), and Urban Co-operative Banks. 87 The main objectives of Indian Bank? Association are: promoting and ontogenesis sound and progressive Banking principles and practices in order to assist Banks to develop and implement recent ideas and innovative Banking wait ons, operations and procedures; organizing co-ordination and co-operation on procedural, legal, technical, administrative or professional paradoxs and practices of Banks ; circulating statistical info, information, views and opinions on the Banking ashes; conducting care culture Programs for B anks; promoting pedagogy and knowledge of the law and practices of Banking application; to tending in projecting ripe(p) public image of Banking diligence ; and to promote harmonious relationships by devising slipway and concocts for involving Banking mortalnel? in the harvest-time and development of Banking manufacturing. Indian Bank? s Association tries to achieve excellent service quality and customer care through with(predicate) and through its foc apply efforts to make each customers love a pleasant one. Towards this end Indian Bank? s Association accent on to build rung say-so by each Bank to continue customer challenges and asked Banks to design a performance management system, which foc wasting diseases on rewarding the mental faculty for delivering flawless customer service. In 2000, Indian Bank? s Association reviewed the charters of diverse Banks and brought out a „Model Citizen select? explaining to the customer? s what they could expect from th e Bank? s as a matter of right.\r\nApart from this Indian Bank? s Association brought „bankers fair practices? in 2004 which was pick out by all Banks voluntarily. It as well came out with „fair practice regulation for credit plank operation? and „model code for collection of payables and repossession of security? with special concern to customer? s voice nigh Banking practices 4. 88 Ministry of Finance Ministry of Finance in India governs the entire fiscal system of the brass of India. The three departments headed by the Ministry of Finance in India include: economic affairs, expenditure, and revenue. Thus, it mainly centralizes well-nigh the economic and financial issues pertaining in India.\r\nMinistry of Finance Government of India, Banking Division is managing Government policies cerebrate to the massageing of Banks and the term bestow to financial institutions. This Division is headed by Secretary (Banking and amends) and ope pass judgment throu gh three subdivisions: Industrial Finance; Banking operations; and Banking and Insurance. Each subdivision is headed by a Joint Secretary. The Banking Operations sub-division grapples with legislative proposals set forth to Banks, non-banking financial companies, and other associate matters desire appointments of Chief Executives and Government nominee Directors and non-official directors on the boards of in the public eye(predicate) firmament Banks. In appurtenance policy matters relating to Private Banks, foreign Banks, and good of customer? service in Banks and redressal of customers grievances are to a fault dealt with this Banking Operations sub-division of Ministry of Finance. This sub-division as well as deals with vigilance matters and appoints Chief Vigilance ships officers (CVO? s) in the Public domain Banks to modify the Public heavens Banks to meet the credit requirements for the productive sectors of the frugality in proportion to the economic festerin g of the country. The Government is committed to inf lend oneself cracking currency in Public field Banks as well 5. 89 ad hominemity of Banking Industry Bank? s fortress money and valuables and provide loans, credit, and payment service, such(prenominal) as checking accounts, money-orders, and cashier? s checks. Banks also offer investment and insurance products which they were once prohibited.\r\nThere exists descriptor of models for cooperation and integration among finance industries some of these traditional distinctions between Banks, Insurance Companies, and Securities Firms has diminished. In spite of these changes, Banks continued to state and perform their primary role of evaluate deposits and lending funds from these deposits. Banks securely surrender the money of depositors, provide checking operate, and lend the funds raised from depositors to consumers. Bank? s at once are in a all-inclusive range of sizes, from large Global Banks to regional and Community Banks. These Global Banks are tough in international lending and foreign currency trading, in addition to the more typical Banking go. Working Environment Employee? in a typical branch snuff it weekdays, whereas in some Banks some quantify Banks were loose until late evenings or were open on Saturday morning? s and in few even on Sundays. Supervisory and managerial employee? s, usually work substantially long-lived hours. Some Banks are expanding the workingss hours in their branches which are located at non- 90 traditional locations, such as obtain malls, which remain open on more or less evenings and weekends. Branch office logical arguments, oddly front-end positions, essential unremitting communication with customers. Some employees essential to work for longer hours in a confined space. Loan officers might pick up to travel to meet clients, or work evenings for their clients.\r\nLoan officers also check loan applications, and solicit invigorated stage business for Banks. Financial renovation Sales Representatives might also begin to visit clients in the evenings and on weekends to go through the client? s financial pauperization. To improve customer service and provide greater access to Bank personnel? s, Banks lay down staffed Customer Service Representatives. The remaining Bank employees, working at the headquarters or other administrative offices usually worked in comfortable environment and worked for a standard workweek. In general, Banks are considered relatively unafraidr place to work with heed to injuries and illness. Banks also encourage gamyer education and training for their employee? as Banks require inventive and talented batch to compete in the market place so as to reach to more number of customers. The basic premise here is to Study the pertinent data and derive some information related to the Strategic Environment pertaining to Indian Banking Industry, which may be accustomd in repayable course in a broade r context if non in particular(prenominal) context. Environmental doers influencing Banking Industry are: 91 Economic federal agents Indian economy has registered dramatic harvesting of over 9 portion for successive three financial long time and experienced simpleness in 2008-09. This restraint was ca purposed due to the downturn in the worldwide economy. The year 2008-09 was the most deficient year afterwards 1972.\r\nTo fight once morest this heavydown Government of India and Reserve Bank of India took many fiscal as well as monetary actions. It was expected that Indian economy could again register a robust harvest rate in the year 2009-10. As per the revised estimates released by the Central statistical Organisation (CSO), Indian economy grew by 7. 6 portion in 2008-09 and 9. 3 portion developing in the 2007-08 6. Banks lending to industries, personal loans and service sectors witnessed a b wishing down while, Banks lending to agriculture and ally activities loc omote upward during 2008-09. The income as well as the expenditures of plan Commercial Banks viewed a slow down leading to come down in the net profit.\r\nThe Return on Assets (ROA) as an indicator of faculty with which Banks deployed their assets remained to 1 portion in 2009. The Return on Equity (ROE) as an indicator of efficiency with which the Banks substance abused capital enlarged to 13. 2 per centum in 2009 from 12. 5 per centum in 2008, indicating change magnitude efficiency with which Banks used capital 7. 92 offset of income of Scheduled Commercial Banks during 2008-09 decelerated to 25. 7 pct from 34. 3 in 2007-08, but was higher than the growth rate of 24. 4 portion in 200607. Expenditure of Scheduled Commercial Banks was 24. 1 portion in 2006-07, which change magnitude to 33. 9 percent in 2007-08 and again decelerated to 26 percent in 2008-09. The operating profit of Scheduled Commercial Banks accession sharp by 33. percent during 2008-09 from 26. 8 per cent in 2007-08 and 21. 3 percent in 2006-07 (Table II. 1). The net profit of Scheduled Commercial Banks also showed a significant increase of 36. 9 percent during 2007-08 as compared to 26. 9 percent in 2006-07, but it decelerated to 23. 5 percent during 2008-09(Table II. 1) give in II. 1 innovation IN INCOME-EXPENDITURE OF SCHEDULED COMMERCIAL BANKS 2006-07 Income Expenses in operation(p) Profit Net Profit 24. 4 24. 1 21. 3 26. 9 2007-08 34. 3 33. 9 26. 8 36. 9 2008-09 25. 7 26. 0 33. 2 23. 5 origin: Reports on curl and leave of Banking in India 8, 9 The Bank Group-wise outline is presented in Table II. 2.\r\nEven though the achievements of proficient changes in Banking Industry in India were staggering but at that place is a need to take greater advantages from unfermented technologies and information establish system to maximize the insurance coverage. Pricewaterhouse Coopers discipline 18 suggested that Banks should take up mechanization that would be a combinatio n of change networks, operations and a Core Banking applications that include channel Intelligence (BI), Business address Re-engineering (BPR), and Customer Relationship Management (CRM) that catered to practicable and analytical business needs. The multi- argument Banking has acquired further dimensions to include troika party payments such as utility bills through different bring including alter teller cars and unsettled banking. Bank? internal groups examined the issues, relating to rural credit and micro-finance opportunities in the sector with several possible options like smart card-based kisan credit cards, smart card solutions for self- attend to groups, alter bank clerk Machines with local lyric and voice facility and call-center amenities with added services given by various Banks. intro of Kisan Credit Cards (KCCs) for providing credit to farawaymers had increase in the number a multi-fold since its inauguration in the late 1990? s and the amount of money percentage share of these cards reached in a higher place forty percent 19. 97 Banks had change themselves into Universal Banks by adding innovative impart with lucrative pricing.\r\nRecent innovations in the form of total quality management, reengineering work processes, e becomeic systems have unless one occasion in common serving the customers well through improved operational efficiency. integrating in the Banking Industry followed by scientific up-gradation acted as a key factor to boost the international competitiveness of the Indian Bank? s. Adapting engine room had brought down the woo of doings visibly and at the similar time aided in business continuity. A Study mentioned that the price per transaction through a branch was Rs. 66, constitute per transaction ; through change fabricator Machines was Rs. 22, and apostrophize per transaction through meshwork was Rs. 0, ignoring the extreme variations owing to the investment cost and nature of proceeding 20. T his low cost benefit was opted by Commercial Banks as it helped them to reach to pathetic the great unwashed, particularly those working in the rural areas and those who earn and throw away cash. In order to handle their cash transactions Banks formulated two types of info and communicating Technologies (ICT). People could either use Automated storyteller Machines that could accept, store or dispense cash or they could use a biometric device, which were mobile in nature. theme in India, has improved resulting into widespread use of Automated fabricator Machines facility in villages as well.\r\nThese machines consisted of additional features that include fingerprint use as a mean of authentication with a view that rural people were more comfortable with fingerprints than fictile cards. 98 The wide geographical coverage to access Banking related products and services with the help of mobile phone technology and the use of profit for banking transactions has gained superior usa ge. These modes of transactions need a safe and secure environment and provide a soma of options available for customers with different requirements. The numbers of mobile phone subscribers in India were about 261 meg (March 2008). Towards this end, Reserve Bank of India issued guidelines for mobile banking transactions.\r\nInitially Banks offered the facility to their customers subject to a unremarkable cap of Rs. 5,000 per customer for fund convert and Rs. 10,000 per customer for transactions involving purchase of goods or services 21. Usage of mesh banking in India is mainly dominated, by Private and Foreign Banks. Still, the number of individuals utilizing internet services has increased considerably. In 2006, about 12 percent of the 38. 5 million internet users in India used online banking and the figure for online banking increased to 16 million in 2007-08 22 . The reasonable cost of servicing a customer through internet banking is the tenth of the services wide throug h a branch.\r\nThus, there is a direct contribution to the profitability for a Bank and therefore, internet banking became a potential low cost utility(a) 23 . From customer? s viewpoint, internet banking is highly convenient as it help to avoid branch queues and makes customer free from depending on the in unvarying quality of services at the branch, which varied from person to person at the service desk. Internet Banking allowed customers to operate their accounts at their convenient hours sooner of creation dependent on the Banks working hours. Moreover, internet banking permitted customers to transact on a 24Ã7 basis from any part of the world. 99 Therefore, internet banking delivery channel has the potential to contribute directly towards the nation? prosperity as it allowed more people to join the Banking stream without adding cost and it is staggeringly convenient to customers. Reserve Bank of India started measures to make up multi-lingual links on its website for thir teen Indian languages on all matters concerning Banking in June 2007 24. In the recent days, the use of electronic payments has witnessed obscure increase reflecting increased adoption of technology. The electronic payment systems comprised of the large evaluate payment systems like Real term megascopic Settlements (RTGS), subject Electronic Funds murder (NEFT) and card based payment systems. The growth of volume of transactions directed through electronic payment has decelerated from 41. 4 percent in 2007-08 to 24. 8 percent in 2008-0925.\r\nThe numbers and usage of Automated Teller Machines had gone up substantially during the last few years. Automated Teller Machines were to begin with used for cash drug withdrawal and repose enquiry. In 2008-09, the total number of Automated Teller Machines installed by the Banks grew by 25. 4 percent. Automated Teller Machines of State Bank of India group registered a sharp growth of 34. 5 percent. While the Automated Teller Machines i nstalled by new Private celestial sphere Banks and Foreign Banks was 3 times of their single branches 26, 27 . In March 2008, the people per automated teller machines in India was more than 29,500 as against the range of 1,000-9,500 in some of the other emerging market economies 28, 29 . In June 2009,\r\nReserve Bank of India permitted Scheduled Commercial Banks to install off-site Automated Teller Machines at places identified by them, without any need to take leave from the Reserve Bank of India. Cash withdrawal from Automated Teller Machines of the Bank? s was made free of charges, April 2009 onwards. This made Automated Teller Machines more popular among customers. antiophthalmic factorere-second Banks had deployed teaching technology solutions to facilitate mechanization in transaction management, reporting and attempt management. Most of the Banks across the segments had already utilise Core Banking Systems. In the 2007, 85. 6 percent and in the 2008, 93. 7 percent Public celestial sphere Banks were fully computerised 30, 31 . former(a) rograms such as internet based transactions, self-service kiosks, mobile banking were either underway or planned in snuggle future by Public area Banks. Foreign Sector Banks and old and new Private Sector Banks in India, had progressed well in the areas of technology up-gradation in operations. engineering up-gradation helped to introduce new products and services to enable Banks to improve the quality of service and value added services. Overall, Indian Banks score well with remark to technological adaption and the three key lineament contributing towards the effective use of information technology in Banking Industry were: ? Factor Cost Advantage- information technology related labour costs in India remained cheaper as compared to other countries; ?\r\nDistribution Strategy- Indian Banks select a unique business model, getting customers rapidly with minimal technological investments; and ? schooling Technology Governance- Indian Banks emphasized on information technology governance with the untouchable in-house Information Technology Division and a Chief Information Officer (CIO) directly reporting to the Chief Executive Officer (CEO) in most cases. 101 It is information that made the Banking Industry stable. The pressure of emulation and the need to improve productivity has generated a need for mitigate information. In order to manage Banking operations to meet the needs of managers operating at tactical and strategic take and to improve their quality of decisions and policymaking processes within the Banks.\r\nBanks indispensable to set up an businesslike and comprehensive Management Information System (MIS) without which asset and liability management and attempt management were not possible. However, adoption of technology by Banks provided them competitive advantage in their operations but at the identical time Banks became dependent on outsourcing for most of thei r technological applications. Therefore, Banks needed to employ discreetness to put in place mechanisms for vender management. As an insecure system, could expose Banks towards salutary operational regulatory and reputational chances. Banks have taken measures to safeguard the risk factors, emerging due to the use of technology.\r\nTowards this end, the Institute for Development and explore in Banking Technology (IDRBT) helped Banks to bring in technology and enabled them to work in secured environment while operating Real Time Gross Settlements System, Centralised Fund Management System (CFMS), merged e-mail, and internet banking. It also acted as a „certifying authority? for the Banking Sector in India by issuing digital Certificates 32 . Still there exists need to ensure much more accountable systems with regard to online payments with uniform standards all over the world. 102 Social Factors Before nationalization of the Banks, their control was in the hands of the pr ivate parties and barely big business houses and the effluent sections of the nightclub gained benefits from the Banking in India.\r\nThus, adoption of the social development model in the Banking Sector was necessary for speedy economic progress consistent with social justice in pop policy-making system. Bankers were directed to help economically weaker sections of the society and to provide needed finance to all the sectors of the economy with flexible and panoptic attitude. India? s demography had undergone transition and the demographic trends 1950 †2050 studied, illustrates that India? s fertility rate is consistently falling from the peak 5. 91 percent in the first decade after independence to 2. 76 percent immediately and expected to fall further to 1. 85 percent. Even the death rate also likewise showing consistent decomposition from its peak 25. 5 in 1950-55 to 8. 5 today and to the lowest of 7. 9 in 2020-2025 33 . This ignifies towards steady number of customers for Banking Sector with longer income in the coming years. Indeed, India would be one of the youthfulnessest nations with its median age lying between 25 and 30 years over the next 15 years (2010 to 2025) 34. This signified that India would enjoy its prevalence of young age population for near tetrad decades. Thus, India? s demographic transition needed to be exploited by Banking Sectors aftermath it as an prospect. 103 Increase in the per capita income of the working class population of India, enabled individuals to purchase goods, which were far out of their reach earlier. It also promote people to buy goods for their personal use and for their family.\r\nToday societies have shifted towards nuclear family, resulting into the outgrowth needs for home consumer durables like washing machine, television, bike, car etc. This showed how we as a society have moved from a socialist society to a consumerist society. Understanding these changes and to use them as an opportunity Bank s provided various types of loans to farmers, working women, professionals, education loan to the students, house loans, and consumer loans. Even customers life style, their behaviour, and pulmonary tuberculosis patterns have changed which acted as an opportunity as well as a scourge for Banking Industry. Deposits showed a subdued growth during this decade. In 2008- 09 personal loans by Commercial Banks was 12. percent with respect to 10. 8 in 2007-08 of which hold loan was 11. 6 percent in 2007-08 and 7. 4 percent in 2008-09 35 . This deceleration was notice in housing loans especially due to economy slow down. Literacy rate in India is low as compared to other developed countries. Illiterate people hesitate to transact with Banks. Therefore, this influenced negatively on Banking Industry. Nevertheless, there exists positivistic side of this as well that illiterate people trust more on Banks to deposit their money as they do not have market information they do not put money i n stocks or uncouth funds so they look Bank as their sole and safe alternative.\r\nFor a common man Banks have emerged as the key players to provide variety of products and services like saving accounts, insurance, remission of sin and other facilities to the under privileged and the poor in rural, semi-urban and urban areas or socially disadvantage as well as the small and medium enterprise sector . 104 On the other hand Banks deal with big clients or big companies which required personalized banking as these customers do not believe in running and hold in queues for getting their work through . To these customers bankers provided special provisions and at times benefits like individualised hosting to these types of customers. It was brought to the notice of the Reserve Bank of India that visually challenged persons were facing problem in availing Banking facilities.\r\nReserve Bank of India in June 2008 advised all Banks to ensure that all facilities such as cheque volume incl uding third party cheques, Automated Teller Machine facilities (at least one third of new Automated Teller Machine installed with Braille key pads and located strategically), net banking, locker, and credit cards to be provided to visually challenged persons without any discrimination 36. Banks related crimes are rising. These crimes included the typical ones such as Bank robbery, false statement to a Bank in order to obtain loan, false entry in a Banks book, Bank bribery, and Bank fraud. The other new types of crimes have also emerged like accessing to the whole or any part of information technology system without rights.\r\nThese also included manipulation of Banking system, data alteration, or data destruction to make unauthorized identicalness theft with reference to Automate Teller Machines. Indian police has initiated by interruption of special cyber cells across the country and started educating the personal against these crimes. 105 Political Factors Before 1990, the lack of accountability and lack of profit creator in Nationalized Banks was credited to political deterrent. aft(prenominal) the economic reforms of 1991, the Indian Banking Industry entered into the new horizon of competiveness, efficiency, and productivity. Reserve Bank of India? s control system and its monetary policies acted as a major weapon in India? financial market. However, sometimes looking into the political advantage of a particular party, Government declares some measures for their benefits like short-term agricultural loans to attract farmer? s votes touching the profits of the Banks. Even according to Banking banana tree Skins, survey 2010 political randomness was considered as the greatest risk for Banking Industry 37. In the Budget provisions, Finance Minister increased the farm credit target for 2009-10 at Rs. 3, 25,000 crore compared to Rs. 2, 87,000 crore in 2008-09. The Union Budget 200910 extended the debt waiver evasion by half dozen more months for farmers owing more than 2 hectare of land.\r\nThe Union Budget 2008-09 allowed farmers 25 percent rebate on 75 percent of their overdue repayment within the stipulated bound 38 . Government also announce setting up of a problem force to examine the issues of debt taken by a large number of farmers in some regions of Maharashtra from private moneylenders who were not cover under the loan waiver arrangement 39 . With Government bearing this burden, Banks would not be affected much. As Government assured to help, Banks to clear their most opinionated non-performing assets accounts on Banks Book. In addition, the emphasis on expanding network with Automated Teller Machines, hatchway of Banking centre in unbanked blocks were some of the positive moves taken by Government. 106\r\nPolitical interference by the leftist political parties claimed that various regulations with respect to Foreign Banks would benefit only those Banks, which intend to make a fast(a) jump by providing high-profile corporate services, instead of those who wish to intensify their rural operations. left political parties also cautioned that foreign players could increase their holding size in a particular Bank that would lead to an unstableness of strength. Banks under the conventional system of recuperation of loans had a considerable amount of money blocked in form of unprofitable assets. Hence, to beat this difficulty parliament enacted recuperation of Debts to Banks and Financial Institutions Act, 1993 also refereed as Debt retrieval Act. This Act created a separate frame-up in the order of Debt Recovery Tribunals, which were pass on over the responsibility of administering disputes pertaining to non-payment of debts.\r\nAs this mandate was general in nature, another(prenominal) general assembly by Parliament was enacted , referred as Securitization Act with an objective to give the Banks, more power over defaulting borrowers 40,41. Unions The post nationalization era in the Bankin g Industry in India, particularly in the Public Sector, witnessed consolidation of betray sums. both the nine unions had all-India presence in the Banking Industry. Five workers unions and four officers unions represented almost 100 percent of the workforce in the industry and joined hands to form a United Forum of Bank Unions (UFBU). United Forum of Bank Unions comprised of any India Bank Employees Association, (AIBEA), All India Bank Officers union (AIBOC), 107\r\nNational Confederation of Bank Employees (NCBE), All India Bank Officers Association (AIBOA), Bank Employees fusion of India (BEFI), Indian National Bank Employees coition (INBEC), Indian National Bank Officers sex act (INBOC), National Organization of Bank Workers (NOBW) and National Organization of Bank Officers (NOBO) 42. Representatives of unions were encouraged to give suggestions. However, in many cases undue interference of unions in decision-making has adversely affected, leading to the deadening in disc ipline, efficiency, and performance effectiveness. With the growing strength of these organizations, the issues relating to employees elicits were no longer determined by Bank? s managements alone. The massive invention of technology into the industry made union policies defensive.\r\nUnions focused almost entirely on the immediate consequences of technological change on the workforce, especially the aspect of possible job losses. Employees in Public Sector Banks were abominable to move from one table to another of the very(prenominal) branch. Now the trade unions appear to be willing to allow mobility for employees within a district as mergers oblige them to move from one state to another. Other issues taken up by unions were like introduction of rising Pension scheme and variable pay which were resolved with the help United Forum of Bank Unions. Banks unions are also involved in demanding net hikes, job losses, disinvestments in Public Sector, and issues related to violati on of labour laws, and allocation of funds for schemes for unorganised workers. 108\r\nAfter attempting, the macro aim environmental analysis of Indian Banking Industry a micro functional level Human resource Environmental compendium has been attempted with the help of SWOT analysis (Strengths, Weaknesses, Opportunities, and Threats), it would help to further develop strategic viewpoint about the industry (Table II. 4). TABLE II. 4 HR SWOT summary WITH RESPECT TO INDIAN BANKING INDUSTRY STRENGTHS ? ? ? ? ? ? ? amend Manpower Higher Compliance Amongst Employees undergo Employees Training Infrastructure Availability good Working Environment Responsiveness to required Change Strong Regulatory institutional Framework ? ? ? ? ?\r\nOPPORTUNITIES Liberalization of Banking Sector best-loved Industry for Employment Availability of Multi-specialist staff Technology for Improved Interpersonal and Communication Skills Workforce Diversity WEAKNESSES ? ? ? ? ? ? ? ? Limited Technology Ski lls Repetitive Tasks Structure Inadequate profit for Attracting Talent Lacking Career Growth Path Rigid Recruitment Policies hierarchal Structure Rigid Wage duologue Process Leadership Deficit at Senior Level ? ? ? ? ? ? ? THREATS Movement of virtuoso(prenominal) and Quality supply Difficulty in Hiring Highly Qualified Youngsters Trend Towards retrenchment Changing Workforce Demographics High Staff Cost Overheads Changing Employees Expectations Entrenched barter Unionism 109 Key Concerns for Indian Banking Industry\r\nThe macro level analysis of Banking Industry and micro level analysis with respect to Human Resource functions helped to identify the key concerns related to the Banking Industry. Competition in Banking Industry is very high as Banks are fighting for same share of customers. There are many Banks and non-financial institutions which gave rise to escalate competition. Amongst these, there existed relatively no speciality in services and every Bank seek to copy ea ch other? s services and technology which increased the level of competition. Competition from the non-Banking financial sector is increasing rapidly as there are substitutes like mutual funds, stocks (shares), government securities, debentures, gold, and real estate acting as a high threat of substitutes.\r\nThe continuous deregulation has made the Banking Market extremely competitive with greater autonomy, operational flexibility, decontrolled participation rate, and liberalized norms for foreign exchange. The deregulation of the industry mate with decontrol in interest rates had led to the entry of a number of players in the Banking Industry 43. Alliances and takeovers had occurred on a transatlantic basis. The market share for financial services that Banks hold had declined, while securities firms, mutual funds, and finance companies has grown 44 . Banking Sector needs to build up a strong and efficient financial system by emphasizing on risk based management. 110\r\nIn Banki ng Sector, customers have high bargaining power due to the presence of very large number of alternatives. Banks together with the specialized financial companies that provide finance to customers are available. Recently it was observed that depositors had withdrawn funds from Private and Foreign Banks and invested their money with Public Sector Banks as the cost of switching from one Bank to another was low and almost all Banks provided undifferentiated services. Today customer? s have more information and better understanding about the market, Banks have to be more competitive and customer favourable to serve them. To retain customer? s and market share, Banks started contemplating on building strong relationship with customers.\r\nUnited Bank of India created a revolution in Banking Industry by opening up a dress shop branch in Pune in November 2007, as its priority was to provide services to the high net worth customers. Thus, United Bank also recognized the needs of high net wo rth individuals different from the other customers. United Bank organized corporate golf tournament for customers, music concerts, and cover of Mani Ratnam directed film „Guru? 45 . Bank? s top management has started cautiously evaluating the impacts for their actions. Recently, before cutting jobs in Private and Foreign Banks, Human Resource managers tried to assess reactions beforehand and they came out with certain proactive steps. Banks persistently worked in the interest of the Society.\r\nThis chapter focussed on the environment analysis which is, undoubtedly, required for strategy formulation, and at the same is relevant as a background knowledge for strategy implementation. For instance, the needful Human Resource Practices have to be continuously evolved and use against the ever-changing macro and micro environment of the Banking Organizations. 111 REFERENCES 1. Wei, C. C. (2001) Environmental Scanning as Information Seeking and Organizational Learning, Information Research, 7(1). 2. to the highest degree us retrieved on 26 celestial latitude 2010. 3. Goyal, O. P. (1979) Financial Institutions and Economic Growth of India, New Delhi: Light and Life Publishers. 4. About Us retrieved on 26 celestial latitude 2010. 5. retrieved on 28 December 2010. . Reserve Bank of India (2008) Report on Trend and pull ahead of Banking in India 2007-08, & group A;lt; www. rbi. org> retrieved on 25 December 2009. 7. 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